Nordic Mines AB: Nordic Mines resolves on Rights issue of

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Nordic Mines resolves on Rights issue of SEK 51 million and directed new issue

On 15 March 2017 the Board of Directors of Nordic Mines AB (publ) ("Nordic Mines" or the "Company") resolved, subject to the approval by a forthcoming extraordinary general meeting to be held on 18 April 2017, on a rights issue of shares and warrants (Units) (the "Rights issue"). Upon full subscription of the Rights issue, the Company will raise approximately MSEK 51 before issue expenses.

The Rights issue in summary:

• On the record date for the Rights issue, shareholders in the Company will for each share held in the Company receive one (1) Unit right. Three (3) Unit rights entitles to subscription of one (1) Unit, consisting of one (1) share and one (1) warrant.
• The subscription price is SEK 0.27 per Unit (corresponding to 0.27 SEK for each new share). The warrants are issued without consideration.
• The warrant gives the right, during 2 April 2018 - 30 April 2018, to subscribe for one  (1) share at the lowest of the shares' quota value at the time the warrant is utilized and 0.27 SEK.
• Upon full subscription of the Rights issue, Nordic Mines will raise approximately MSEK 51 before issue expenses.
• The subscription period is 2 - 16 May 2017.
• Upon full utilization of the warrants in April 2018, Nordic Mines will raise not more than approximately MSEK 51 before issue expenses, assuming a quota value of no more than 0.27 SEK.

Notice to the extraordinary general meeting to, inter alia, approve the decision of the issues, will be made public through a separate press release.

Lau Su Holding AB and Lao Tzu Investments AB have informed the Company about their intention to set-off existing shareholder and short term loans of USD 1,200,000 and 250,000 respectively, including accrued interest until 16 May 2017, by subscribing for Units in the Rights issue. This corresponds to 22.0 percent and 4.7 percent respectively of the Rights issue, if fully subscribed. The existing shareholder and short term loans of USD 1,450,000 in total, including accrued interest, accumulate to 26.7 percent, of the Rights issue, if fully subscribed.

Directed new issue

The Board of Directors also intends to propose the extraordinary general meeting to approve the Board of Directors' resolution on 15 March 2017 on a directed new issue to Lao Tzu Investments AB, a company controlled by the Company's Chairman, Vinod Sethi, which company is not a shareholder in the Company, but hasprovided the Company with a short term loan of USD 250,000 (the "Short Term Loan"). The Short Term Loan provided by Lao Tzu Investments AB, together with accrued interest until 16 May 2017, amounts to SEK 2,398,248.94 calculated with the exchange rate 9.03 SEK / 1.00 USD as per 28 February 2017 The Board of Directors has resolved on the directed new issue to allow Lao Tzu Investments AB to set-off the Short Term Loan against shares in the Company to the Subscription Price, in accordance with the terms of the Short Term Loan. The exchange rate when calculating the amount of the Short Term Loan to be set-off against shares in the Company shall be 9.03 SEK / 1.00 USD. The maximum size of the directed new issue is set to 8,882,403 shares and 8,882,403 warrants.

However, the directed new issue will be conditional upon that the Rights Issue being fully subscribed. Hence, the Board of Directors will in first hand allocate Lao Tzu Investments AB Units in the Rights Issue, and only allocate Lao Tzu Investments AB Units in the directed new issue if Lao Tzu Investments AB has not been able to set-off the Short Term Loan through subscription of Units in the Rights Issue.

Background and reasons for the Rights issue

Further development of Laiva and general corporate purposes. Detailed information will follow this announcement shortly.

Terms and conditions of the Rights issue

On the record date for the Rights issue, shareholders in the Company will for each share held in the Company receive one (1) Unit right. Three (3) Unit rights entitle to subscription of one (1) Unit, consisting of one (1) share and one (1) warrant. The subscription price is SEK 0.27 per Unit (corresponding to 0.27 SEK for each new share). The warrants are issued without consideration. The warrant gives the right to, during 2 April 2018 - 30 April 2018, subscribe for one (1) share at the lowest of the shares' quota value at the time the warrant is utilized and 0.27 SEK.

The Rights issue comprises in total a maximum of 188,574,252 shares and 188,574,252 warrants. The subscription period will be between 2 - 16 May 2017, or such later date as resolved by the Board of Directors of the Company. The prospectus for the Rights issue is estimated to be made public on 28 April 2017.

If the Rights issue is fully subscribed, the number of shares in Nordic Mines will increase by 188,574,252 to 754,297,008 shares in total and the share capital will increase by SEK 50,915,048.04. In addition there will be 188,574,252 warrants issued. Shareholders choosing not to participate in the Rights issue will have their respective holdings diluted by 25.0 percent, upon full subscription of the Rights issue, but will have a possibility to be economically compensated for the dilution effect by selling their respective Unit rights.

The Board of Directors will further propose the extraordinary general meeting to reduce the Company's share capital with maximum SEK 96,961,993.74 to SEK 152,745,144.12, without cancellation of shares.

The Board will also propose the extraordinary general meeting to resolve upon a bonus issue of maximum SEK 83,343,720.78, to enable to transfer additional funds to the share capital, without the issuance of new shares, with the effect that the share capital would be fully restored.

The Board of Directors will further propose the extraordinary general meeting to resolve on an adjustment of the Company's articles of association lowering limits of the share capital from SEK 200,000,000 - SEK 800,000,000 to SEK 100,000,000 - SEK 400,000,000, and amending the limits of the number of shares from 200,000,000 - 800,000,000 to 400,000,000 - 1,600,000,000.

In addition, the Board of Directors intends to propose the extraordinary general meeting to reduce the Company's share capital so that the quota value of the Company's share becomes SEK 0.27. However, such reduction of the share capital requires permission from the Swedish Companies Registration Office or the Swedish district court. 

The total Rights issue proceeds amount to a maximum of approximately MSEK 51 at full subscription before issue expenses.

Upon full utilization of the warrants in April 2018, Nordic Mines will raise not more than approximately MSEK 51 before issue expenses, the number of shares will increase with 188,574,252 and the share capital by SEK 50,915,048.04, assuming a quota value of no more than 0.27 SEK.

If the directed new issue to Lao Tzu Investments AB is fully subscribed, the number of shares in Nordic Mines will increase by 8,882,403 to 763,179,411 shares in total. The number of warrants, if the directed new issue is fully subscribed, increases by 8,882,403 to 197,456,655. However, as stated above, the directed new issue will be conditional upon the Rights issue being fully subscribed. Hence, the Board of Directors will in first hand allocate Lao Tzu Investments AB Units in the Rights issue, and only allocate Lao Tzu Investments AB Units in the directed new issue if Lao Tzu Investments AB has not been able to set-off the Short Term Loan through subscription of Units in the Rights issue.

Additional information

The Rights issue and the directed new issue are subject to the approval by the extraordinary general meeting in Nordic Mines. An extraordinary general meeting will be held on 18 April 2017, at 14:00 CET, at Visma Services AB, Lindhagensgatan 94 in Stockholm, Sweden. A notice to the meeting will be made public through a separate press release and will be available at the Company's website www.nordicmines.com.

Indicative timetable for the Rights issue

Financial and legal advisors

EVLI Bank is financial adviser and Advokatfirman Lindahl is legal adviser to Nordic Mines in connection with the Rights issue.

For additional information, please contact:

Rune Nordström, Head of Corporate Communications and Investor Relations:

rune.nordstrom@nordicmines.com, +46 70 602 65 20

For more information about Nordic Mines, please visit www.nordicmines.com .

Nordic Mines AB (publ) is obligated to make this information public pursuant to the EU.

Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 09.30 am CET on 15 March 2017.

IMPORTANT INFORMATION

Publication or distribution of this press release in certain jurisdictions may be subject to restrictions according to law, and the people in jurisdictions where this press release has been made public or distributed should inform themselves and follow such legal restrictions. This press release does not contain and does not constitute or form part of an invitation to acquire or subscribe or a solicitation of any offer to buy or subscribe for shares or other securities in Nordic Mines.

This press release may not be published or distributed, directly or indirectly, in or into the United States, Australia, Hong Kong, Japan, Canada, New Zeeland, South Africa or in any other jurisdiction where such distribution would be prohibited by applicable law. The information in this press release may not be redistributed, reproduced or passed on in ways that conflict with applicable restrictions. Failure to comply with these restrictions may constitute a violation of the United States Securities Act of 1933 ("Securities Act") or applicable laws of other jurisdictions.

Forward-looking statements

This press release contains certain forward-looking statements that reflect the Company's current perception and expectations regarding future events and financial and operational progress, including statements regarding the Rights Issue and statements regarding guidance, planning, prospects and strategies. Words such as "intends", "assesses", "expects", "plans", "estimates", "can", and other expressions that imply indications or predictions regarding future progress or trends and that are not based on historical facts, comprise forward-looking information. Even if the Company considers that these statements are based on reasonable assumptions and expectations, the Company cannot provide any guarantee that such forward-looking statements will materialize. As these forward-looking statements include both known and unknown risks and uncertainties, actual results may vary materially from those set forth in the forward-looking information. Forward-looking statements in the press release apply only at the time of publication of the press release and may be revised with out further notice. The Company does not undertake to publish updates or revisions of forward-looking statements as a result of new information, future events or similar, other than those stipulated by applicable legislation or stock market regulations.

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